Mergers and acquisitions are business expansion strategies that compliment the organic growth of your business. They allow you to combine with other businesses to fast track growth and accelerate expansion in existing and new markets. The strategies allow you to take advantage of established structures of other firms to synergize your market penetration strategies and help increase product diversification. However, discrepancies between your corporate profile and the entity you are merging or acquiring pose significant challenges to your M&A goals.

Corporate Culture Defined

Corporate culture is the set of attitudes, norms and values unique to your organization. Your business has a distinctive corporate culture that defines your interactions with employees, customers, suppliers, creditors, communities and the government. Mergers and acquisitions bring together businesses that have different corporate profiles, with the merged firm surrendering its corporate rights to the dominant entity.

Reviewing Organizational Structures

Review and harmonize the operational and strategic structures of your business soon after merging with another firm. Realign the mission, vision, objectives and logos of the company you are merging with or acquiring, to ensure they are relevant to your corporate aspirations. This eliminates discrepancies that may exist between your corporate culture and that of your merged entities. The integration process should see you maintain your existing business structures as the primary point of reference, with the incoming entity providing secondary information for adjusting the primary organizational structures. For example, retire the corporate website of an acquired entity and have your current business website serve as the official corporate website.

Transition Period

Create a transition period for migrating from some of the existing organizational practices to the new procedures that may be necessitated by your merger or acquisition. Set and communicate the specific dates when some of the old structures of the individual firms will cease to operate and when newly introduced adjustments will take effect. The transition period will provide room for employees to familiarize themselves with the operational, strategic and cultural orientations of the firms involved in the M&A.

Induction and Training

Conduct induction and training to enable employees of your firm and those of the incoming entity to learn understand the new organizational protocols attributable to the M&A. Allow the employees of the merged or acquired entity to be trained on issues such as work performance and feedback communication processes of your business. It is also imperative to train your existing staff on procedural changes that result from M&A. For example, your accounting staff will have to adjust to new financial reporting procedures, such as consolidated financial reporting for business subsidiaries created through the M&A

About the Author

Paul Cole-Ingait is a professional accountant and financial advisor. He has been working as a senior accountant for leading multinational firms in Europe and Asia since 2007. Cole-Ingait holds a Bachelor of Science Degree in accounting and finance and Master of Business Administration degree from the University of Birmingham.